Using the following table. What denominator would you use to create the price weighted index, if stock EFG got split 5 times in the initial period(Price is now $5, and the number of shares is 500). Assume that the value of the Index is 45. Stock Initial Price EFG HIJ 25 65 Final Price 26 62 Shares 100 35

Using the following table. What denominator would you use to create the price weighted index, if stock EFG got split 5 times in the initial period(Price is now $5, and the number of shares is 500). Assume that the value of the Index is 45. Stock Initial Price EFG HIJ 25 65 Final Price 26 62 Shares 100 35

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Consider the three stocks in the following table. P, represents the price at time t, and Q, represents the total shares outstanding at time t. Calculate the rate of return on a price-weighted index of three stocks for the first period (t=0 to t=1). Table 2: Data for Q4 & Q5 Q0 P1 Q1 PO 100 50 105 50 A B 200 100 210 100 C 300 100 250 100
The table below describes the price per share (P) and the number of shares outstanding (Q) at time = 0 and then again at time = 1. The subscripts indicate which time (t = 0 or 1) that the information applies to. Stock A Stock B Po 90 50 Qo 100 200 P₁ 95 45 Q₁ 100 200 (A) What is the "market cap" for Stock A at time 0? 9000 (B) Assume you have an index that includes only these 2 stocks. What is the value-weighted rate of return for the index from time O to time 1? Choose the answer closest to the correct number. -0.026 (C) Assume someone asked you calculate the equal-weighted return for a portfolio that included these 2 stocks. What is the equal-weighted return from time 0 to time 1? 0.055
Consider the three stocks in the following table. Pt represents price at time t, Qt represents shares outstanding at time t. Stock C splits two for one in the second period from t=1 to t=2. Calculate the rate of return on a price-weighted index consisting of the three stocks for the first period from t=0 to t=1. Answer in percentage. Stock P0 Q0 P1 Q1 P2 Q2 A 70 475 75 475 75 475 B 45 850 40 850 40 850 C 50 300 60 300 30 600 a. 0.00% b. 2.49% c. 6.06% d. 8.95% e. 1.30%
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Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C splits two-for-one in the last period (t=2). Po A 100 B 60 C 120 Qo 100 200 200 P₁ 105 55 130 Rate of return b. An equally weighted index. Rate of return Q₁ 100 200 200 % P2 % 105 55 65 Calculate the first-period rates of return on the following indexes of the three stocks (t = O to t = 1): (Do not round intermediate calculations. Round your answers to 2 decimal places.) a. A market value-weighted index. Q2 100 200 400
1.You are given the following information regarding prices for a sample of stocks. PRICE STOCK NUMBER OF SHARES T T +1 A 1,000,000 60 80 B 10,000,000 20 35 C 30,000,000 18 25 a.Construct a price-weighted index for these three stocks, and compute the percentage change in the index for the period from T to T + 1. b.Construct a value-weighted index for these three stocks, and compute the percentage change in the index for the period from T to T + 1 c.Briefly discuss the difference in the results for the two indexes.
What is the CAPM required return for Stock Z, in decimal form? Round your answer to 4 decimal places (example: if your answer is .13579, you should enter .1358). Margin of error for correct responses: +/- .0005. expected return (implied by market price) Beta Stock Z 9.7% 1.43 MRP 6% ? T-bonds 5% ?
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Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C splits two-for-one in the last period. PO 00 P1 01 P2 02 A 82 100 87 100 87 100 B 42 200 37 200 37 200 C 84 200 94 200 47 400 Required: a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t= 1). (Do not round intermediate calculations. Round your answer to 2 decimal places.) Rate of return % b. What will be the divisor for the price-weighted index in year 2? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Divisor c. Calculate the rate of return of the price-weighted index for the second period (t = 1 to t = 2).
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